Last year the legislature passed a major piece of legislation, AB 327, that deals with the future of net metering. While that was a short-term victory for solar advocates, it put the long-term future of net metering in the hands of the California Public Utilities Commission (CPUC).
Alas, that result was a decidedly mixed blessing, as departing Commissioner Ferron recently noted:
But recognize that this is a poisoned chalice: the Commission will come under intense pressure to use this authority to protect the interests of the utilities over those of consumers and potential self-generators, all in the name of addressing exaggerated concerns about grid stability, cost and fairness. You – my fellow Commissioners — all must be bold and forthright in defending and strengthening our state’s commitment to clean and distributed energy generation
Which brings us back to the petition campaign over at Vote Solar.
Here’s the petition text in full:
Dear California Public Utilities Commissioners,
I am signing this petition because I believe in protecting Californians’ right to go solar and receive full credit for the clean energy they deliver to the grid.
California has more than 200,000 solar roofs, and we expect to boost that number to half a million by the end of 2017. The policy of net metering has been crucial to recent growth and the creation of local jobs around the state. Rooftop solar systems reliably produce electricity for 30 years or more, and Californians invest in rooftop solar because they expect long-term bill savings over the life of the system.
Under Assembly Bill 327, the Commission must decide how long solar customers may continue under current net metering rules. Changing the rules unexpectedly for customers who have already made solar investments and signed contracts would be unfair and would drastically slow our state’s solar momentum.
I urge you to stay the course and allow customers who install solar under the current program to continue under current net metering rules for at least 30 years.
We believe that the CPUC needs to hear from as many Californians in support of solar as possible. Trust me, they are already hearing plenty from the lobbyists for SCE, PG&E and SDG&E.
Please take a moment to add your name in support of rooftop solar by signing Vote Solar’s petition.
SCE has two rate structures commonly used by commercial customers: GS-1 and GS-2. As part of our new website roll-out, we have been exploring the use of interactive data visualizations and we decided to create one to explore the impact of demand charges under SCE’s commercial rates.
Here’s some background. SCE’s smallest commercial customers, those whose peak power demand is 20 kW or less, are assigned to the GS-1 rate. This is a rate structure very similar to what one has at home - charges are based on the total amount of energy used in a month (as measured in kWh). Moreover, this is a flat rate structure - every kWh costs the same, and does not account for when it is consumed. (NB: this is changing; over the next year SCE’s commercial customers will be moved to a time-of-use rate structure, but for now, most are not. We will have more to say about SCE’s commercial time-of-use rates later.)
The GS-2 rate structure, on the other hand, includes all commercial customers with peak power demand between 20 and 200 kW - a very large segment of the commercial customer base. For them, an additional rate component is introduced - peak power charges, better known as demand charges. While GS-2 customers pay significantly less per kWh of usage, they more than make up for it in demand charges. Indeed, during the summer months, GS-2 customers pay for demand charges twice!
The net effect of all this is that GS-2 customers generally pay significantly higher bills than they would if their rate was based on usage alone. To explore that, we created this visualization. Derived from the actual rate tariffs (which are linked to on the site), this allows you to compare what your annual bill differential would be against a variety of scenarios. Since most commercial customers have a peak demand significantly higher than their average, that is the first “knob” to adjust - as average demand becomes a smaller percentage of peak, the differential increases.
To try this for yourself, click on the image above to go to the visualization page.
We would love to hear your thoughts about this tool, as well as SCE’s commercial rates. Please let us know what you think in the comments.
A key to the growth of solar, particularly commercial solar, is the availability of affordable storage solutions. Two recent developments suggest that we are about to see dramatic growth in this vital market sector.
One week ago the California Public Utilities Commission (CPUC) voted five to nothing approving a plan to require the three investor-owned utilities (SCE, PG&E, and SDG&E) to procure 1,325 MW of energy storage by 2020, with installation completed by no later than the end of 2024. Both SCE and PG&E are required to procure 580 MW each, with the remaining 165 MW allocated to SDG&E. 200 MW of that 1,325 MW total is to be interconnected at the customer’s site. In addition, the decision provides a timeline for this to happen with the first 200 MW to be procured by the end of next year.
Other electric service providers, like the munis, will have to procure energy storage equal to 1 percent of their annual peak load by 2020. Those storage systems can also include customer sited and/or customer-owned storage devices as long as they were installed after January 1, 2010.
Large scale pumped hydro storage (greater than 50 MW) is excluded from the program, but storage obtained from plug-in electric vehicles can be counted.
This is a tremendously significant decision as the mandate will surely drive R&D as well as deployment investment and help provide a ready market for these emerging technologies.
An announcement this week during Solar Power International shows how that investment is already starting to happen.
Stem - the company with the clever technology for using storage to “smooth out” the demand peaks that drive commercial energy costs - just announced a $5 million project finance fund with Clean Feet Investors (CFI). From the parties’ press release:
The new financing model, which Stem developed in collaboration with CFI, is designed to open access to a wider pool of customers by removing barriers to adoption, enabling up to 15 MW of energy storage to be deployed. With this financing capability, Stem hopes to follow the dramatic growth trajectory pioneered by the third party ownership model in the solar industry. Stem and CFI plan other innovative financing offers for customers including performance-based and shared savings financing solutions with the capital from this financing.
“In addition to breakthroughs in technology, Stem is focused on driving business model innovation,” said Prakesh Patel, Stem’s vice president of capital markets and strategy. “By working closely with CFI, I believe we have created a unique offering to help accelerate customer adoption of Stem systems. This transaction paves the way for Stem to become one of the first efficiency technologies to achieve bankability.”
“Deployment capital is essential for Stem to get their technology in the hands of their customers – many of whom prefer a “pay as you save” offering,” added Jigar Shah, a principal at Clean Feet, and founder of the largest solar services company, SunEdison.
Allowing companies to install Stem’s technology with little or nothing down will help those companies save money at the same time it allows Stem to ramp up. This is great news for the solar industry since it is posed to provide the energy that Stem’s system later distributes as needed to offset those costly demand peaks.
Of course, this isn’t exactly great news for the utilities who, if this technology were widely adopted, would see a huge revenue hit as more and more commercial customers were able to lop-off the most expensive energy they now have to procure. Whether it is the continuation of net-metering on the residential side or the ability to eliminate the worst of demand charges on the commercial side, the pressure on the utilities will only continue to grow. But for their customers, things have never looked brighter.
A fascinating piece over at Bloomberg Businessweek Technology turns our question into a declaration: Why the U.S. Power Grid’s Days are Numbered in a piece by three authors, Chris Martin, Mark Chediak and Ken Wells. But it isn’t the grid so much as the 3,200 utilities scattered across the landscape that are headed for extinction. (H/t SolarWakeup.com)
The article traces the story, familiar to readers of this blog, about the downward spiral facing utilities - as their prices rise, more customers get to the point where solar makes economic sense. But that switch further erodes the revenue base for the utilities so they must raise their rates yet again, driving away yet more customers and on it goes. Clearly not a sustainable future - for the monopolistic utilities. (Perhaps that is why some - and here we mean you, SCE - have so little sense of humor these days?)
Here is one of the many insightful quotes compiled by the authors:
“The technology and energy sectors will no longer simply be one another’s suppliers and customers,” the report says. “They will be competing directly. For the technology sector, the first rule is: Costs always go down. For the energy sector and for all extractive industries, costs almost always go up. Given those trajectories, counterintuitively, the coming tussle between solar and conventional energy is not going to be a fair fight.”
(Quoting from the Bernstein energy industry black book.)
Hmmm… solar beating up on the utilities so badly that it isn’t a “fair fight” is a future that many of us would pay to see.
While that future might seem inevitable to reporters viewing this from a distance, those of us in the solar industry know that we have a major fight on our hands. Today we have a sympathetic legislature in Sacramento, but that could change and our allies replaced by adversaries almost overnight. Surely the utility industry has the bucks to lobby legislators in ways that the solar industry will never be able to match.
As I said, the article makes for great Friday reading and I commend it to you.
A group of solar advocates have received a cease and desist letter from Southern California Edison over a satirical video that dares to claim that SCE “is committed to rooftop solar - and by committed we mean committed to keeping it off your roof!" Proof that SCE lacks both a sense of humor and common sense. (H/t Chris Clark at the ReWire blog on KCET.org)
The three groups threatened - presente.org, the Sierra Club (really!) and The Other 98% - have a website titled Save Rooftop Solar where the video was originally displayed. On their website they make the case that rooftop solar is good for the Latino community. That seems like a fair message to be communicating, but it is the group’s attack on SCE’s lobbying efforts that drew the IOU’s ire. Here’s the video that SCE doesn’t want anyone to see:
Now this is clearly satire, and no reasonable person viewing this would believe that SCE produced this video. Moreover, in highlighting an issue of public interest - namely SCE’s lobbying campaign directed at Latino politicians (no doubt part of their faux “equity” argument) - the use of otherwise protected symbols and logos is certainly “fair use” and thus protected. But that didn’t prevent SCE’s thin-skinned legal department, in this case Ms. Janet Combs, from sending a short-sighted nastygram:
It has come to our attention that presente.org has funded and posted a video on its website and on YouTube that infringes the Southern California Edison and Edison International (Edison) name and logo and makes false and misleading statements regarding Edison.
Specifically, the video, entitled Edison Hates Rooftop Solar, misrepresents itself as an Edison video and claims that Edison wants to “keep solar panels” off customers’ roofs through a “business plan” to “force” customers to buy “dirty energy” from “dirty power plants” that “poison poor communities.” The video claims that Edison is “spending big on Latino politicians” to make installing solar panels on customers’ roofs more expensive and discourage customers from installing solar panels.
These statements, and similar statements in the video, constitute false and misleading advertising under state and federal law. Moreover, the video’s use of the Southern California Edison and Edison International marks constitutes both federal and state trademark infringement and violates both the federal and state laws against unfair competition.
Here’s the thing - first of all, the assertion that SCE has legal claims against the producers of this video is laughable. But beyond that, when a video that practically no one has ever seen goes up on YouTube accusing you of being an evil corporation that is trying to (literally) squash your opponents, you do not counter that argument by sending C&D letters that threaten to squash your opponents. (See also, the Streisand Effect.)
Let’s hope that these groups get lots of press over this and SCE is sufficiently humiliated over their strong-arm tactics. Well, a guy can dream, can’t he?